Valiant – let’s bank on it!


On January 17, 2019, the Investors in the Fund met in Morges to celebrate the 11th anniversary of the launch of the Fund. We welcomed our guest, Markus Gygax, CEO of Valiant. A few years back, I wrote to you about our investment in this “simple” bank.

“Valiant ( is the eponymous Swiss “plain vanilla” retail bank serving Mr. & Mrs. Mueller from Aarau to Yverdon and Basel to Zell (Lucerne) in 80+ branches. Although Valiant never indulged in financial weapons of mass destruction, unlike UBS & CS, the Two Sisters, they made mischief in the past.

In the first 10 years of the new millennium, Valiant embarked on an acquisition spree of regional banks in order to grow geographically. The (former) management of Valiant did not fully integrate the many regional fiefdoms. The acquisitions were financed with its own stock, which is fine, except that Valiant propped up the price of its shares against the general market trend. It kept the stock artificially high, seriously violating supervisory provisions on market conduct. Unsurprisingly, FINMA imposed special conditions on Valiant, which the bank complied with to the complete satisfaction of the Swiss banking policeman. The file is therefore now closed.

Valiant did its homework, taking drastic & necessary measures on the personnel level: a new Chairman of the Board, Jürg Bucher, plus some new Board appointments; a new CEO, Markus Gygax, former head of retail banking at BCV, who will start on the 18th of this month; and a new CFO in March 2013.”

Fast forward 5 years and our special guest, Markus, communicated very thoroughly what he & his management team are up to. They are executing on their Strategy 2020 by consolidating & innovating the branch network, defending the Bank’s client base of SME & the self-employed, creating successful alternative funding products like triple-A covered bonds and ensuring a smooth management transition, with Markus joining the Board of Directors at the next shareholders’ meeting and Ewald Burgener, the present CFO, replacing him as CEO.

Last, but not least, we are probably halfway there, with a Valiant share price still trading more than 20% below its intrinsic value and 30% below its book value.

As Leonardo da Vinci said: “Simplicity is the ultimate sophistication”.


The Dragon Trip

In order to better understand where the world action is with respect to some of our corporates, I’ll be travelling in Asia until February 10. My stops will be Beijing, Tianjin, Shanghai, Changzhou, Hong Kong, Singapore & Kuala Lumpur. I shall visit production facilities, sales representative offices and shops & will meet with the local management of the Asian sites in the various aforementioned locations of our Swiss companies, such as Conzzeta (Bystronic & Foampartner & Mammut), Geberit, Komax, Calida (Millet-store), Aryzta in Singapore, DKSH in Malaysia & many many Swatch group shops (Bréguet, Omega, Harry Winston & others).

It should make for an interesting travel report upon my return!


China Sound Bites

I am sending this message on my way to Chengdu (15 mn inhabitants), departing from Kunming (7 mn inhabitants) sitting in the bullet train, eating my Mr. Kon noodle soup, having made a stop at Guiyang (4 mn inhabitants). Next stop: Chongqing (30 mn inhabitants).

136 airports will be built in China within the next 5 years.

In the Shanghaï Tower (632 meters, 2nd tallest building in the world) the elevator travels at a speed of 18 meters per second.


Ni Hao!

Happy Chinese New Year!